I read an article today about a couple who sold their Florida home but failed to disclose a defect. In this case it was a previous sink hole problem. The story explains the couple apparently had received an insurance payment of $153,000 years earlier but failed to address the problem.
This situation illustrates a few key points for home buyers, sellers and real estate agents.
- Sellers, disclose. Failure to disclose material issues that affect the home's value can potentially bring legal troubles. As a seller (even as a FSBO) do not hide anything – period. In this case a conviction for wire fraud with sentencing scheduled by a federal court for January 2016.
- Buyers, verify. There is a time between contract and closing allocated for the performance of due diligence. In the words of Nike, "Just Do It!"
- Realtors, protect. Placing blame for non-disclosure on your real estate agent is likely not a reasonable strategy. Most professional real estate agents have processes and procedures in place to document the purchase process minimize risk.
In Florida real estate licensees commonly use a sellers property disclosure with questions designed to lead a seller to disclose potential issues and facts about a property. While the form asks about topics like any roof issues, systems (AC, heating, etc), appliances, association rules, water damage, zoning or future use changes, etc. it may not address every significant issue.
As a matter of practice I have sellers complete the disclosure form at the time of listing as any serious buyer will request the disclosure prior making an offer. I do not assist any seller in completing the property disclosure form.
However I do advise the same thing – disclose, disclose, disclose. If there is doubt if something should be disclosed my thinking is simply "if it is something you would like to know if you were the buyer, why not disclose it?"
And there are other disclosures that will likely be required if applicable such as the lead based paint, disclosure.
Don't alienate your buyer or break the trust when something shows up on an inspection report that should have been previously disclosed.
Don't risk a transaction failing, or worse, some legal issue by "forgetting" to disclose.
The above is based on Florida real estate procedures and rules. Check your state's rules and processes. Better yet, call a local Realtor!
Considering buying or selling a home in Brevard County, Florida? Call me at 321-693-385 or send me an email.
Image courtesy of Stuart Miles at FreeDigitalPhotos.net
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